We’ve discussed biotechs a lot lately both here and in our newsletters. They remain a big focus for us as a possible canary, considering their leadership (bubble?) during the cyclical rally and their spectacular selloff (pop?) this spring. Currently, we’re looking at the weakness in the iShares Nasdaq Biotech ETF, not initiated but excacerbated by Janet Yellen’s comments. Specifically, the preliminary area of support we see on the chart lies at the 244-245 level.

The significant points of support at the 244-245 level include

• 38.2% Fibonacci Retracement of the April-July rally
• 161.8% Fibonacci Extension of the July 9-14 failed rally
• 50-Day simple moving average

Should that level break, much more significant support is at the roughly 235 level. We’ll continue to monitor and address the developments as happen.